J. Ambrose vs. The Director

Held

The Court held that the impugned order dated 20.06.2024 passed by the second respondent is a non-speaking order. It failed to consider the relevant GST notifications and the specific circumstances of the case, particularly the rate of GST applicable on the date of the award of the works contract. The Court found that the respondent mechanically rejected the petitioner's claim without addressing the merits of the notifications cited. Therefore, the order could not be sustained. The Court quashed the impugned order and remanded the matter back to the second respondent for fresh consideration. The second respondent was directed to provide an opportunity of hearing to the petitioner and pass a reasoned order considering all aspects within four weeks from the date of receipt of the order. The writ petition was allowed.

Facts

The petitioner, J. Ambrose, was awarded a works contract by CSIR - Central Electrochemical Research Institute (CECRI) through a work order dated 27.01.2023. The petitioner completed the work and was paid in March 2023. The petitioner paid GST at 18% on the contract. However, CECRI sanctioned GST at 12%. The petitioner represented seeking reimbursement of the difference of 6% GST, citing notifications that initially set the rate at 12% until 18.07.2022 and subsequently increased it to 18% by Notification No. 3 of 2022 Central Tax (Rate) dated 13.07.2022. The respondent, CECRI, rejected the claim via an order dated 20.06.2024, stating that the GST difference did not arise for tenders whose last date of receipt was after 18.07.2022. The petitioner challenged this order before the High Court.

Key Issues

1. Whether the impugned order dated 20.06.2024 passed by the second respondent is a non-speaking order, failing to consider the relevant GST notifications and the date of the award of the works contract? Petitioner's arguments: The petitioner contended that the impugned order is non-speaking, mechanical, and fails to consider the GST notifications cited by the petitioner. Specifically, the petitioner argued that the rate of GST applicable on the date of the award of the works contract should be considered, and the increase in GST from 12% to 18% occurred after the tender notification but before the award. The petitioner relied on Notification No. 11 of 2017 Central Tax (Rate) dated 28.06.2017 read with Notification No. 20 of 2017, Central Tax (Rate) dated 22.08.2017, and Notification No. 3 of 2022 Central Tax (Rate) dated 13.07.2022. Revenue/State's arguments: The judgment records no specific arguments from the respondents.